Will the costs of carbon capture justify its benefits?

Carbon capture and storage (CCS) often appears to be one of those technologies that is perpetually 10 years away. It doesn’t help that in the UK we’ve had several false starts thanks to the collapse of the first government funding competition to build a demonstration plant and an attempt to add CCS to the controversial idea of building the country’s first new coal plant in decades.

But now things are starting to look more promising. This week, the next tranche of funds was confirmed for the second of the government’s two preferred bidders in its revamped CCS competition, Peterhead gas power station in the north east of Scotland. Work will now begin on a £100m programme of engineering studies before the final go ahead is given to the Peterhead project and its coal counterpart, the White Rose project at the Drax power station in North Yorkshire.

Once completed, Peterhead will capture up to 1m tonnes a year of carbon dioxide from the exhaust of its 385MW combined cycle gas turbines using amine solvents, and pipe it offshore to the Goldeneye gas reservoir, 2km below the North Sea bed. White Rose, meanwhile, will see the creation of a new 426MW oxy-fuel combustion plant, where coal is burnt in oxygen instead of air to produce a pure stream of CO2 (2m tonnes a year) that will then be piped into saline aquifers off the coast. This will include the building of a new pipeline system with a capacity of 17m tonnes a year, paving the way for a cluster of CCS plants around the Humber.

These projects are important not because they will demonstrate that it’s possible to capture CO2 from power stations (several plants in countries including Germany and the US have already done this), but because they will join up the three elements of capture, transport and storage and highlight the UK’s strong potential to become CCS world leader.

Carbon from Peterhead will be pumped offshore to the Goldeneye gas reservoir

Unlike Germany, where CCS has been hampered by public opposition to onshore underground CO2 storage, the UK has access to vast amounts of offshore storage in both aquifers and empty gas fields. There’s also the chance to use the captured CO2 to improve North Sea drilling operations and tap otherwise uneconomic reservoirs by using it for enhanced oil recovery (EOR), helping make CCS more commercially viable. We also have a strong research base and a financial mechanism to support low-carbon power generation (the bit of our energy bills that will subsidise new nuclear, renewables and, eventually, CCS).

The argument for CCS is pretty persuasive from a decarbonisation point of view. It might be an untested system with initially high costs that will still produce some CO2 emissions (around 10 per cent of a fossil fuel power station’s total with current technologies) and still requires a constant supply of difficult to produce fuel, whose cost is volatile at best. However, it also produces a flexible, dependable source of energy that could even help remove CO2 from the atmosphere (if we attach CCS technology to biomass plants).

None of our other options – nuclear or renewables ­– can be easily turned on or off to meet our fluctuating power demands. Without a cheap form of mass energy storage, which we’re not particular close to developing, CCS looks like our best bet for a cost-effective, low-carbon way to meet the gap between our energy supply and demand.

Current estimates suggest CCS could become cost-competitive with offshore wind by the 2020s, and with the price coming down faster. Research by the Energy Technologies Institute indicates that using CCS rather than continuing to rely on CO2-emitting gas plants for flexible power supply will reduce the need to decarbonise transport, heating and industry, with overall savings of up to £32bn by 2050.

What will it mean for UK engineering? We should probably tone down our ideas of a new manufacturing sector exporting UK-grown technology to the world. The major companies developing CCS systems are based elsewhere and the Far East is likely to offer a more attractive home to much of the manufacturing. However, the crossover between CCS and the chemical and offshore gas industries does create an opportunity for UK firms to get in on the action with some supply chain production and expertise in services.

In that sense, these demonstration plants could really be the start of a new world-leading UK industry. One estimate suggests 13GW of CCS-equipped low-carbon generation could be up and running by 2030, generating £3bn-£6.5bn annually for the UK economy and supporting 70,000-100,000 jobs.

To get there, however, we will to provide major financial support to a raft of projects following the initial £1bn given to the current competition. The idea is that the second generation of UK plants will raise their building costs from the private sector but still rely on subsidies for operational costs. And these subsidies could be much greater than the prices we’re currently agreeing to pay for nuclear (around £90/MWh) or offshore wind (£155/MWh). We’ll also need to support research into other CCS technologies, for both power station and industrial emissions. And continue to develop the transport and storage infrastructure. Then finally we’ll get to the third generation of plants that are cost-competitive with renewables but will probably still need subsidies.

If CCS is really our cheapest option for meeting our CO2 targets, then it puts the debate about shale gas into a whole new light. Fracking might produce a reliable new low-carbon energy source but it certainly won’t bring electricity prices down.

Readers' comments
(44)

Jack Broughton | 28 Feb 2014 1:30 pm

Well... if CCS is our best hope for the future and costs more than offshore wing we have not got much of a future. The only reason for anyone considering CCS is the global warming fiction which is driving our academic institutions and politicians to more and more wasteful schemes to prevent that which is not occurring.I guess that I am a headless chicken somehow banging its head against a wall, which is quite an achievement!The caverns should be used for storing natural gas and nuclear waste not long-term gas storage.

CCS is literally a means of sinking money into the ground. Whilst it may be technologically feasable I seriously question the sense in pursuing it. Is pumping CO2 underground really a cost effective means of reducing carbon emissions? If you think CO2 release should be reduced then surely increasing energy efficiency measures are more cost effective. What about planting trees? Ultimately we are discussing reversing a century of profligate carbon release, to have any significant impact on global CO2 levels with CCS amounts to geoengineering!!!

Dr. Patrick Moore, co-founder of Greenpeace, went before the U.S. Senate yesterday to tell his story as it relates to global warming/climate change. It is well worth your time to read. http://wattsupwiththat.com/2014/02/26/confessions-of-a-greenpeace-droput-to-the-u-s-senate-on-climate-change/

A couple of comments. Surely the suggestion that we use this technology for enhanced oil recovery is means to ensure Carbon Release and Escape (CRE) as the recovered oil then produces more CO2 when it is used. Scondly, I suggest that we have to be careful about the provenance of where the coal burnt in the CCS power stations comes from. At present nearly 70% of the coal the UK produces comes from opencast / surface mines. It would be a shame if we solved one environmental issue by a new technology that encouraged the expansion of another environmentally damaging process, opencast mining.

While fringe interests are always entertaining those who are not scientists with evidence to present would be advised to accept the view of The Royal Society.http://royalsociety.org/policy/projects/climate-evidence-causes/

"Current estimates suggest CCS could become cost-competitive with offshore wind by the 2020s." Not a chance - chasing a moving target. CCS will always add to running costs, consuming more gas or coal, while prices keep rising. It will never play a role in electricity generation. Arguably, it should be used to curb other manufacturing emissions, but then they'd have to be subsidised.

Cheaper floating wind/wave will harvest more energy and dispatch renewable electricity from storage at a moment's notice. Gas and coal plants are already becoming uneconomic, destroying their business case. Read and digest:-http://www.economist.com/news/briefing/21587782-europes-electricity-providers-face-existential-threat-how-lose-half-trillion-euros

When gas has no 'back-up' role the plant is a stranded asset.

"Without a cheap form of mass energy storage, which we’re not particular close to developing." You first need to define what you mean by "mass"! We can start building it tomorrow, instead of deploying even more intermittent renewables. Would you like to see some designs of before-generator energy storage? Then get in touch.

"Fracking might produce a reliable new energy source." Not a hope in hell - not in the UK. Would you welcome a fracking rig to your back yard or local green countryside? As for "low-carbon" - are you serious?

CCS has to be one of the most ridiculous ideas dreamed up and the Engineers responsible should be ashamed!Unless there is, or can be developed in the forseeable future, a practical and thermodynamically sensible method of converting the stored Carbon into something useful then there is no logical IMHO reason to waste more energy capturing and storing it for no good purpose.

Not sure about the cost effectiveness of CC - to me trees have always been good at that - and they do it for free!

What worries me more is why the UK government is pumping this sort of money into Scotland - Surely it would be more sensible to wait to see if Scotland remains part of the UK. Or is it viewed as foreign aid - bit like subsidising coal powered fire stations elsewhere in the world!